New provisions concerning beneficial owners in accordance with the amended and supplemented Law on Enterprises

July 2, 2025 | Legal Updates

On June 17, 2025, the National Assembly passed Law No. 76/2025/QH15, amending and supplementing a number of articles of the Law on Enterprises. Accordingly, effective from July 1, 2025, Vietnam officially implements regulations concerning the "Ultimate Beneficial Owner" (UBO) in its legal framework for enterprises. The official regulation of beneficial ownership marks a crucial turning point in the effort to enhance transparency in business and investment activities of enterprises, as well as to apply anti-money laundering regulations in Vietnam. The concept of the beneficial owner is expected to address the issue of "shadow ownership," a situation where individuals or organizations own or control an enterprise without disclosing their identity, which has been a loophole for corruption, money laundering, and activities aimed at tax evasion or circumventing investment and business regulations in Vietnam.

I. What is an Ultimate Beneficial Owner (UBO)?

According to the Law on Enterprises, "the ultimate beneficial owner of an enterprise with legal entity status (hereinafter referred to as the enterprise's UBO) is the natural person who actually owns the charter capital or has the right to control that enterprise, except for cases of the direct owner's representative in a 100% state-owned enterprise and the representative of the state capital portion in a joint-stock company or a multiple-member limited liability company in accordance with the law on management and investment of state capital in enterprises."

Accordingly, the UBO regulation is stipulated for business types with legal entity status, meaning that sole proprietorships and business households are excluded from the UBO concept, although in practice, nominee ownership often occurs in these types of businesses as well. The UBO of an enterprise with legal entity status is the natural person who actually owns the charter capital or has the right to control that enterprise. This regulation excludes the cases of the direct owner's representative in a 100% state-owned enterprise and the representative of the state capital portion in a joint-stock company or a multiple-member limited liability company, as prescribed by the law on management and investment of state capital in enterprises.

II. Enterprise's Obligations Regarding the Ultimate Beneficial Owner

Effective from July 1, 2025, enterprises with a UBO have the following obligations:

To collect, update, and retain information about the enterprise's UBO; to provide this information to competent state authorities to identify the UBO upon request.
To update the List of Ultimate Beneficial Owners (if any) in the enterprise's records.
Competent state authorities have the right to request the business registration authority to provide information on the UBO for anti-money laundering purposes, free of charge. The Government shall issue detailed regulations on the identification criteria, declaring entities, and the declaration, provision, retention, and sharing of this information.
For enterprises established before July 1, 2025, the supplementation of information on the UBO (if any) and information to identify the UBO (if any) shall be carried out concurrently at the time the enterprise performs its next procedure for registering or notifying changes to its business registration contents, unless the enterprise requests an earlier update.

III. Conclusion

The regulation on the Ultimate Beneficial Owner (UBO) is a significant legal advancement, marking Vietnam's efforts to enhance the transparency of the business environment and integrate with international standards on anti-money laundering. Mastering the definition, correctly identifying the subjects, and strictly implementing the obligations to declare and update UBO information under the 2025 Law on Enterprises are mandatory requirements for businesses.

Therefore, enterprises need to proactively review their ownership structures and prepare to comply with the new regulation from July 1, 2025, to ensure stable operations and minimize legal risks. DB Legal will continue to provide updates on new regulations regarding this matter.

The information contained in this article is general and intended only to provide information on legal regulations. DB Legal will not be responsible for any use or application of this information for any business purpose. For in-depth advice on specific cases, please contact us.

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